The scariest thing for any company is news that Amazon is expanding into their space. Whether it’s grocery stores or health-care, Amazon is a monolith that cannot be reckoned with.
Shipping is no different. And it seems that Amazon has, for some time now, had its eye on shaking up the shipping industry. To their credit, there is a lot of opportunity for change in that world; competition has a great way of making others innovate. Most recently, it was reported that Amazon has begun enlisting smaller organizations to help with last mile deliveries.
The process of Amazon breaking into shipping and logistics has been slow, methodical, and well-thought out. Most recently, WSJ reported that Amazon has been working with small up-starts to help build out their last-mile delivery operations. But last-mile is not the only aspect of shipping that they are after.
Let’s take a look at the last few years, and how Amazon has slowly been entering this space:
Amazon Launches “Prime Now”
In February of 2015 Amazon launched its 1-hour delivery service Prime Now, starting in small markets – such as Manhattan. The new service, which eventually expanded beyond smaller markets, aims to take on other services, such as PostMates.
Amazon Acquires a Fleet of 747s
In spring of 2015, Amazon finalized a plan to lease 20 747 jets from a third party. This was seen as another early sign of Amazon’s attempt to build out a robust logistics network internally, further decreasing its reliance on external parties. However, Amazon claimed (and continues to claim) that this is meant to supplement, not replace, its existing network.
Amazon Purchases a Fleet of Trucks
In late 2015, Amazon announced it will be purchasing and utilizing a fleet of thousands of trucks across the US and Canada. Prior to this, Amazon worked exclusively with partners such as UPS, FedEx, and USPS.
Amazon Purchases French 3PL Colis Prive’
In early 2016, Amazon announced that it had fully taken over the French shipping company Colis Prive’ – they already owned 25% of the company, but the full take-over signaled a shift in Amazon’s view of shipping.
The implications for bigger players in parcel, such as UPS and FedEx, were quite clear – Amazon was looking to take over the entire supply chain, shipping included.
Amazon Registers as a “Freight Forwarder”
In January of 2016, Amazon China officially registered itself as a “freight forwarder” for the first time. The implications of this move can’t be overstated – they have now moved into the $350 billion space of freight shipping.
Secret “Operation Dragon Boat” Memo Leaked
Later in 2016, a bombshell memo was leaked out of the halls of Amazon – the memo articulated Amazon’s plan to essentially turn itself into a full fledged freight and parcel delivery company.
Amazon Considers Purchasing an Airport in Germany
In the spring of 2016, it was reported that Amazon was considering buying an airport in Germany. Given its acquisition of a fleet of 747s earlier in the year, as well as the airport’s proximity to one of its European warehouses, the move would have made sense. However, as of 2018, the purchase has not yet taken place.
Amazon “Seller Flex”
In October 2017, Bloomberg reported that Amazon had begun testing a 2-day shipping service in markets outside the US – rumored to be titled “Seller Flex.” The trial began in India, but it was reported that it would be expanding into the West Coast of the US by 2018. As with other moves over the years, it seems that Seller Flex is another attempt by Amazon to muscle its way into the space that is currently dominated by UPS, FedEx and others.
Amazon Enlists Small Businesses for Last Mile Deliver
In the summer of 2018, Amazon announced a new program that enlists local entrepreneurs to take on “gig-work” and essentially start their own delivery business by partnering with Amazon for last-mile. As part of this program, Amazon is offering their delivery technology, as well as hands-on training and other tools.
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